Lamborghini was able to launch an entirely new website hosted on amazon stata center.

A lunch with elastic load balancing, cloud computing, a top-notch database, a high- performance website, as high- performance at the car.

It took just one month to get to full speed.

Technology companies have found similar results.

We decided to base one of our most important product, real player cloud, on amazon network services here they do not have to spend billions of dollars to launch appeared this time, they just turned to amazon's cloud.

They are very competitive from a price point same pointer they have very large-scale third wife how big is a? amazon will not say.

But gartner says they have five times the computing power of the next 14 competitors.

Jean mester -- gene munster estimated at $2.5 billion.

Companies can now focus on the strength of their ideas, not the size of their ethnology arsenal.

It cuts down a lot of the operational perplexity.

If you get a deeper perspective on amazon web services, i spoke with senior vice president who has been with amazon for more than 16 years.

Just how it fits into amazon's business as shortly as the world's largest online retailer.

I start off by asking them to describe really simply what is amazon web services.

Aws is a technology researcher platform that allows any company or developer to build their technology applications on top of it.

So if you think about it, the typical application, take it was like, it requires servers, usually needs data store is, -- storage, and instead of having to write or buy that software in and buy hardware and manage the data center piece of it, developers get to use aws, and they get the infrastructure software, the hard work, the data center services all wrapped together neatly in a thermos.

It removes all the heavy lifting.

Anyone was ever managed people know that managing takes is sometimes as long as moving paired is one of your chief obstacles to make them easier to use?

Well, the nice thing about aws is that we built the services at very radical in the structure building blocks, so we did not make decisions of our developers.

They can stitch it together however they wandered that is why you see every work alert -- workload being run on aws, and lots of applications that people do not think was possible before . i have been really surprised to see a lot of really big -- the cia contract really jumped out at me as a surprise on aws, not just because of security reasons, but it because it is such a massive project.

What are you doing to get those amped up rices -- those enterprises, big business accounts?

If you look at the technology platform that aws has built, it not only has a lot more functionality as far as the number of services and the features than any other technology platform, but we are also iterating at such a fast clip that enterprises know that not only can they get more work done given what we allow them to do with our platform, but they also know that we're going to keep iterating quickly on their behalf so that whatever they think is important, they can tell us and we will deliver for them.

When we layer on top of that, the fact we use all this traditional security tactics and strategies that technology companies have been using for the last 30 years, it is much less expensive to build on aws, and it is much faster.

I'm sort of amazed in particular going from cia, sap, whatever, just the ubers and so on, which have grown on aws where they can focus on products, and their idea, and not their sort of technical arsenal.

Yeah, if you look at this day and age, cloud computing has enabled startups from completely nothing to disrupt pretty stable industries.

You look at what airbnb has done, what spotify has done, drop box for storage, it is pretty amazing.

They have disrupted long-held, stable industries because they did not have to lay out any of the capital to build their idea.

They were able to larry -- to iterate multiple times before they ever had to raise capital.

They also can stay private longer because they do not need that next inflow of capital.

So they are scalable on a minute level.

If you were a startup, you had to raise $3 million or 5 million dollars on capital, and you had to spend on infrastructure before you even tested your idea.

With aws and the cloud, because you pay for what you use, you can try several variations of your idea and figure out what works, and then when you raise capital, you have the traction, which allows you to raise at a higher valuation to make much more project -- progress.

And this is so fundamentally different from amazon in so many ways to me.

I recognize -- what do you think are the most fundamental differences, web amazon is one and aws is another?

I have worked in every business amazon is in.

I have been at the company for 16.5 years.

Aws why it is different ataws and that we -- while it is different at aws in that we have a different customer said, there are a lot of very similar things.

Aws, like the rest of amazon, everything we do starts with the customer and then involves backward from there.

In aws, like the rest of amazon, it is a very high-volume, low margin business.

And we have a real longform -- long-term orientation.

We are trying to build a long- term customer relationships to outlast all of us.

Do you ever imagine there will be a product that is consumer-based?

We have a lot of customers who build a lot of consumer base on top of us and a lot of partners, and amazon retail business is built a lot of consumer applications on top of aws.

Amazon the retailer is a big aws customer.

But it is not our plan or intention to build consumer applications.

That was andy jassy, senior vice president of amazon web services.

Jassy told it is good when abv biggest business at amazon, bigger than shipping and selling -- told us that this could be the biggest business at amazon, bigger than shipping and selling.

This is "bloomberg west" live from the amazon reinvents summit chaired i am cory johnson.

Results last night at the company is now forecasting will orderly sale zipline in four years.

Cisco says lower spending by companies, continuing glowing economic weakness, and a number of rivals cutting prices, so shares are hammered here to stocks were down 11% earlier.

Ibm, another hardware drying -- giant -- behind supercomputer watson, engineers can now use watson as a cloud- based tool to design their apps, axes third-party data, and help professionals.

These challenges at ibm and cisco, pro oracle into the mix, all of these companies struggling as everything is moving to the cloud.

Timothy anderson, good to see you.

All of these headlines him together.

You guys in his consulting business, what do you see in terms of how the cloud and aws is affecting the hardware vendors?

We see the impact them nor monthly not just an hardware but in software any kind of work that we do for clients.

For hardware vendors in particular, you put them in a different stage of competition where normally they would be selling directly to their clients.

Now they are in competition to sell things wrapped around the hardware.

A and other things they talk about with ibm and watson.

I think it is not an accident that ibm announces on a day of this web services conference.

Here ibm is trying to sell watson, and now they're saying try it out and see if you like it.

A very different model.

It is.

Amazon is the new type of vendor that started from the ground up selling ground services and analytic services from the cloud.

Based their whole infrastructure on appeared whereas ibm is from the a prior age where these to sell other models.

Microsoft and other companies were trying to catch up.

Aws has been there from the beginning.

It is really the established model.

Aws also allows companies like uber or snapchat or instagram to lunch without having to spend the money on the hardware.

You are saying this with launching projects without having to go through a big hardware uptake.

Absolutely.

One of the critical things and one of the best things we like about aws is the ability to get time to value.

The things that used to take weeks or months we can now do in hours or days.

That changes the discussion with clients, it changes our ability to bring the medivation and have a much more interesting -- brings in innovation and have a much more interesting conversation for it we can do analytical processes where they have complex problems and fraud to the action or indicates of health care, analytics around drugs, appliances, trying to understand better what techniques work and care, things like that.

Complex problems where a lot of data and analytics are involved, but we can get started in a small way very quickly with our clients saying it was a little bit of data, we will apply techniques to it and come back to you with interesting results.

We always come back with things that are unexpected in a very short timeframe, typically a few months.

I am also struck about the size of this.

The last time i was here, there were 6000 be born here.

This time there are 9000 your guy also know, because i am old, i remember when the selling of computers and hardware was at the center of the world of technology.

Am i exaggerating to say that the cloud is the center of technology right now -- right now?

I don't think so.

I am an old combat veteran myself.

If you think about it, google is one of the largest hardware and software builders and developers in the world, yet they do not sell hardly any hardware or software, excel services.

Amazon is now taking that to a whole new level and opening up to other developers, end-users, as you point out, and created an entire new world.

It is really the beginning of the iceberg.

Indeed, timothy andrews with booze out and -- booz allen, to isolate.

Snapchat allows users to send messages that will disappear.

They turn down a $3 billion offer from facebook.

It is far from the first company that turned down a huge buyout.

In 2010, google made a bid for groupon four $6 billion.

Digg was once fielded with acquisition offers as much as $200 million.

News corp.

Offered $450 million for something called pointcast, all the rage at the time.

Pointcast turned it down and later sold for $7 million, which is less, for those of you doing a map.

Simon is joining us now, simon, i am shocked by the size of this offer, and more shocked by the fact that they turned it down.

I think it was a little bit of a cheap copper from facebook.

-- offer from facebook.

Why?

On the last earnings call when they announced they were having a problem with the teen audience, their market cap went down by more than $15 billion, so they are being cheap.

It is only worth $3 billion if they can make money with it.

Or not, is this something they do not want to let this fall into someone else's hands the ipo -- hands?

When a bad -- when ebay acquired paypal, they did not make bolus of money, but they did not want the videos to acquire paypal.

Is it because they slip does not want to lose users to snapchat, or do they think this could be a revenue generator for them?

Twitter just got a load of money and make acquisitions like this, but most of the time, people with big audiences, you know, platforms with big audiences and up working out a way to monetize.

Twitter and facebook being examples where the hundreds of millions of valuation that they have a few years ago was vertical -- was ridiculed by a lot of people.

Now they are $20 billion, hundred million dollar companies.

If the audience is there, especially younger people, the thing of a younger people as they grow up to be younger -- older people.

They will work out a way to monetize.

That is not the big thing to start with.

Simon, why isn't snapchat so hot right now?

Teens the sea facebook -- teens see facebook how i'd also see linkedin.

It is not exactly cool.

If you share any photos or information, they are always scared that a future employer or some yet the university will be able to find those.

With snapchat, you send the message and it disappears.

You can search for anything on facebook and twitter, and snapchat make sure that stuff only exists for 10 seconds.

I wonder about the advertising potential for snapchat.

One of the metrics facebook likes to track is how long do people spend on the site here to snapchat -- site.

Snapchat by definition is somewhere they do not spend a lot of time.

What do you think you?

A groupon, as you mentioned, is someone who should've taken acquisition number.

They made a number -- their money by offering specific offers which disappeared after a certain period.

Why not have offers that disappear after a much shorter amount of time you go -- time?

I'm sure there are lots of ways that snapchat can monetize the hundreds of millions, at the moment, 350 million photos a day.

There is a variety of ways, disappearing special offers might be one of them.

The groupon example is an interesting one because you get a lot of revenue if you sell a dollar for $.50, but at the end of the day, it is about making money.

Do you see a certain type of advertising that will work well on the snapchat platform?

Well, the first thing advertisers look at generally is the target audience, the type of people who were on those platforms.

In this case, i think it is younger, bubbly under 29. mark zuckerberg is 29 himself.

I think probably those types of companies are looking to attract younger, cooler, hipsters, that kind of thing.

Would be defensive company that would be interested in advertising -- would be the kind of countries that would be interested in advertising.

Ok, simon mansell, tgb capital, thank you.

Olivia sterns is in new york.

Markets are rising, stocks are climbing, extending records for the benchmark for the s&p and the dow, both climbing into new record territory.

S&p up by about seven points, dow up by about 43 points.

Nasdaq, little changed on the day.

All this comes as we have been listening to janet yellen, the current rise chairman of the fed, giving testimony to congress over her nomination.

Basically investors are optimistic over what they are hearing from janet yellen, effectively singling -- signaling that she will continue to support the economy.

She's at the recovery has a long way to go.

A couple of individual movers -- the first is kohl's. the retailer is lowering its full-year earnings profit after third-quarter profit payment shorter than estimates.

Aig is downgrading the lululemon saying the same -- the ceo may alienate buyers by saying some women's body types do not work with the clothing.

The ceo, chip wilson, speaking with trish regan adam johnson on "street smart." more "bloomberg west" after the break.

Welcome to the early edition of "bloomberg west." i am cory johnson.

You can also watch at our later time, 3:00 pacific, 6:00 p.m. eastern.

President obama says americans have lost their health insurance policies due to a new health care law and would be able to renew their old lance third this comes as both democrats and were publicans threaten legislation to restore plans.

Delta and united continental all are unlikely to get some of the dozens of airlines they gated by american airlines is part of the u.s. airways and american murder.

These are just more opposition at these airports by low cars -- low-cost carriers, not the larger ones.

The railroad lost $72 billion last year -- $72 million last year.

The food and beverage losses are a long-standing issue and to contribute to the need for federal subsidies.

The silicon valley start up a blue river technology is using their lettuce bot to take on california's biggest veggie crop.

Rachel crane took a trip inside america's fallible.

-- salad bowl.

This is caesar, he is a highly trained tilling machine.

-- kihas target is lettuce.

Do not think of it as tilling, think of it as optimizing.

It is actually called ending, a farming technique that has been around since before the revolutionary war.

You see, lettuce cannot germinate and less the seeds are planted really closely together, and the catch -- it can continue to grow unless some of these lance surrounded it -- plants surrounding it are killed.

Right now are we killing the lettuce?

We are.

You can see the pattern of spraying behind us.

A spray that not only kills but also doubles as fertilizers.

The lettuce and caesar decides to keep is just far enough from the spray to get the benefits of the nutrients without being harmed by over fertilizing your what are those squares?

Those are the bands that spray.

When he noticed the gap, those are the ones to keep.

Right now we are using the fertilizer to kill some of the lettuce.

Right now we are using the jury that decides guilty or not guilty.

The jury if the algorithm?

That is right.

We work toward that so they have a more uniform harvest that in the getting to the grocery store.

Salinas, california is known as the lettuce bowl of the world, and their crop is imperative to the economy.

At issue -- labor.

Lettuce uses a lot of it.

40 to 50 times that of corn or wheat, and that workforce is getting harder and harder to come by.

Lettuce is acquired -- lettuce requires about 50 people working in a field for today's. the bot can finish the same 15- acre plot in maybe three hours.

But automation in agriculture can be costly, part of the reasons blue river technology is not actually selling lettuce pods.

Instead, they are selling their services for the same price as a day of labor.

It occurred to the farmers that there is a financial benefit to using the lettuce bot.

This machine does not get tired.

This machine does not require overtime.

This machine can work in the middle of the night.

This is one technology that helps get more food harvested per acre to be able to get it in the hands of the consumer.

And it is savor food, -- safer food, too.

That was bloomberg's rachel crane.

Sony is launching the new playstation 4 console tomorrow.

We will talk to the ceo of sony entertainment about the new machine and the competition with xbox coming up.

You can also watch us streaming on your phone, tablet, and at bloomberg.com.

This is "bloomberg west" live from the amazon reinvest conference in las vegas.

You have been working for this for years third seven years we have been waiting, cory.

It will be far and away our most successful.

I am really excited about it.

Why are you wanting -- i think the last when he launched first in japan, this one you are launching first in the u.s. it is the tip of the hat to how important gaming has become in the west.

This is where the consumers are.

We are so proud to have its debut in north america first.

Talk to me about price.

Well, $399, a hundred dollars cheaper than the other new intern on the market.

180 games in his element, 23 available on day one, and far and away the most powerful console, 10 times more powerful than the state-of-the-art playstation 3 -- 3. do you really see a -- i know you want -- i know you don't want to mention the competitor, i know it starts with the letter x, but do you think you can take these guys out and dominate?

There is this essential price difference here.

For the for the very reason, we so often appeared we have always been 80 million plus on the playstation three, which is on par with our competition bureau we are relevant on a worldwide basis.

Happen been for three generations in a row.

We really think that playstation defines gaming, and playstation 4 is our best effort yet to the consumer reaction has been phenomenal.

The development community is behind us.

We have a lot of headwinds behind us.

Talk about the slate of games coming out, what partners are getting the most attention?

As i said, 23 great games.

We are blessed with a lot of independent games from the game development community as well as the big-budget titles from companies like activision, ea, you have that assesses great, which is going to do great, you have got the ea sports franchises, you have call of duty coming from activision, and then very proud of our first parties was is, k -- first party exclusives, killzone, 10 exclusives on playstation from day one from family-friendly to games that appear to the core audience.

I am in las vegas covering the amazon services conference, and it is really about the cloud.

I am wondering what you are doing in the cloud as part of this new release, this new platform.

Digital sales are becoming a bigger part of our overall product wondering -- offering, which is difficult to track the industry specifically to the cloud.

We will debut the cloud service, the ability to stream games rectally to your playstation 4 in 2014. do think that is fundamental to the future of this business, that you will not be going out and buy the discs?

Or is the obligation of games so massive that it will require some kind of physical download?

I think it will depend on the consumer, cory.

I think there is a great deal of interest.

The great news is that gains never go over -- never go away now.

Games from legacy platforms are available on the newer platforms.

Games that are no longer available on retail shelves are available digitally.

People are able to play games they came out before they were born, and no game ever truly really dies.

Coming up, under armour spends $150 million to buy the popular mapmyfintetness app.

We will hear from the ceo next on "bloomberg west." making this decision to go friendly, i think this was a direction people were not expecting from us.

I want to be clear, the people touched the reason we were able to make this acquisition is because we had an incredibly successful apparel and footwear business that allowed us to be more aggressive and thinking about what our future will look like.

We think our future aligns with digital.

This is a perfect opportunity for the ranch today gabriel massive step of a story and a journey that began with our nfl combine launch back in february 2011 third and putting leadership, putting the unit -- user base of 20 million people with 200,000 people signing up every single week to this site.

What if mapmyfitner going to be doing -- mappmyfitness going to be doing you?

We were talking about this before we were on the air, i have got mike fitzpatrick, you've got your fit bit, and i do not want to try it, i want to try my job on.

What mapmyfitness does is tracks all of your daily uses.

Give us your tired, your hungry, your poor, we will take all of the absurd whether it is armor and 39, fitness, job long, whatever the uses, i think it is a much more smarter play for a brand like us to be on the destination to be for everybody that is catholic and be data versus on the hardware side today.

So this gives us the ability to say who is the best player, and those are the ones we will line with your you think your next step would be to create your own full bn -- feel bad, fit, jawbone -- we have talked about it, and i'm not going to roll it out, but not until -- one of the things -- the biggest thing we bought of course is the incredible community of 20 million people that we're going to respect, but we also bought leadership, we bought a team of 100 people based in austin, texas, 65 of which are engineers.

So over the last three years of being active with our armor and 39 product out there, we have got about a dozen people in our own digital team.

We have partnered with an authentic leader, it has incredible team that he hasn't on security people are what make this deal happen.

Whether it is the people in austin from mapmyfitness or the 20 billion -- 20 million people are we got there robert thurston like you have a similar background -- pressured abbott who wanted to create a record.

The other person i can compare the two is phil knight.

If the film i model what you look to as to what you want to create with under armour?

I think the might of a great man.

It is not mean we do not wake up everyday and think about how we are going to go beat the heck out of him, and that is the under armour mission third i think getting into this game and digital, our competitors have been there for a long time, and under armour has been there for a long time.

I do not know if we have been as visible, though, so i think this is a real step above declaring and putting a flight in the ground and saying look, arm -- under armour is here to play, we are here to stay, and we will be doing it for a long time there . your innovation operations have been in existence since 2008. you had one employee, now you have a 40. you have a lab that few people have access to.

What goes on in there>? i think this speaks probably to what makes a such a great acquisition for under armour as well.

We started several years ago this open innovation process we call future show.

We get 4000 to 5000 submissions every year on her website.

We call those 5000 submissions, down to about the top 100 and we have a panel they go through the top 100, get it to the top 20, we invite those top 15, 20 ideas to baltimore, hold a trade show in our office.

The american idol of sports theater but i want to know if there is some kid out there who is 23 years old with an idea for a stretchy, tightfitting t- shirt, nudge, nudge, wink, wink, me, i can go make the product myself, but there is this great company, under armour, somebody is just not ready to go.

So things like future show that we host at under armour every october is where -- of the 20, we set it down to five or six.

We award one of the $25,000. forget the money, more important to back him of the five or six panels we have, we are doing business with four or five of those next year, including a winner from 2011's future show is going to their, a magnetic zipper that you consider your jacket up with one hand you're how cool is that?

400,000 pieces of under armour outerwear in 20. you were talking about inquiring -- acquiring intelligence products.

How are you going to -- what are you going to do with your products with your 20 million registered users?

We're going to respect the community.

Do not do anything different.

For six months, this is our first acquisition, so we're going to get to know each other, know what those two southwest life that connect baltimore to boston.

First and foremost pier and we want to make sure that they are cultural.

We're going to put together our own shared vision to decide not where the puck is but we are going to skate where the puck is going to be cured -- be.

Where going to put a collective vision under a leader like robin, and we will be working hand-in-hand together, and again deciding what we do with the data.

I think our company can do a better job of understanding the data of the athlete, again, but having respect for not trying to copper mines, not trying to describe the self of this community, we are going to learn from this.

What are the data?

Robin has seven years of history going back to 2007 of the facts -- do you know the average person runs three miles?

Just knowing these little bits of data -- i am going back and i know have a times -- one of your producers, i was walking in, was telling me how she loves mapmyrun.

That is terrific.

I will be able to go and look at how much did you work out last year, or last month, or last week, into the ability to share that with her friends, look, this country is not getting any skinnier.

The more we can help encourage like him and if you're going to edify a problem, you have to first measure its before you saw it.

We are establishing a protocol that's mapmyfitness has allowed me to the one hour, the four or five times a week i actually go to the gym come i have my armor 39, i can help you track it, and i can tell you are we getting better or worse.

Before we go, what are you going to do to include -- to encourage that maryland football team?

They have all the encouragement they need.

We are one win away.

Because in the team are going to make it happen.

Ok, kevin plank, congratulation on your acquisition and your success with under armour.

Thank you for joining us.

Cori, back to you on the west coast.

Steph, you know i'm all gate out with this mapmyfitness and my fit bit.

You did not need a new app for that.

Stephanie ruhle, thank you very much.

More "bloomberg west" from las vegas right after the break.

Welcome to a special "bloomberg west congo amazon -- "bloomberg west," special edition.

We will sit down with academy award-winning director oliver stone and find out what the man behind "platoon" and "jfk" says about the modern day of film.

56 past the hour, which means bloomberg television is on the market.

Bloomberg's market reporter olivia sterns joins us from new york.

What is going on?

Stocks are rising.

Investors clearly happy with what they heard from the janet yellen, the vice chairman testifying before congress and signifying she would continue the fed policy of stimulus fared we are seeing the s&p and the dell both pushing to new record territory.

The dow is up to 15862, a nasdaq little changed on a day.

Two big movers we want to highlight is no imax theaters shares of the biotech company is getting a boost showing a vaccine for bird flu showed promise in early trials third we are also watching shares in cisco.

Earnings missed analyst estimates.

It was the company's first orderly celtic line in four years, and that is why the nasdaq is underperforming today.

I also want to bring in jeremy hill, the managing director of marketing advisors.

Jeremy, what were your takeaways from the yellen testimony?

Did you hear anything new?

I did not.

I do not think there is much you can really say.

She is clearly defending jobs, that is her bias, and i also think she is defending qe as it is today feared what we have to remember is the fed continues to be dated defending -- dependent.

We saw data recently out of the u.s., both the job reports, so we have to think about paper stock.

We have seen the yield curve begin to state on exit patient says she will succeed bernanke.

If we heard more dovish yellen, what does this mean for the yield curve going forward?

I think it will state, and i think longer, that is a very good bet.

There is a little bit of kink maybe around the five year.

We saw that earlier this year when we were getting closer to the september fomc statement when everybody thought we were going to have a taper.

This time around, perhaps a little kink because we are starting from a higher base here.

Rates are ready -- are already at 2.5, 2.6, 2.7. we saw a much bigger move when they started talking about a taper back in may.

The s&p is up now 26 -- 25% year-to-date.

You said money managers are in a dilemma between fear and greed.

Explain what that means in which is the right move.

It is like a "crouching tiger, hidden dragon" kind of market where the market

This text has been automatically generated. It may not be 100% accurate.